SMM Copper Market Daily Review (2015-10-15)

SHANGHAI, Oct. 16 (SMM) – SHFE 1512 copper opened higher at RMB 39,750/mt for night trading Wednesday in response to LME copper. The contract fell to test RMB 39,720/mt but later shot up to RMB 39,980/mt, to close at RMB 39,940/mt, gaining RMB 230/mt or 0.58%. Positions increased 1,570 to 232,310 and trading volumes were around 160,000 lots.

SHFE copper increased quickly above RMB 40,000/mt on Friday and then moved around RMB 40,100/mt. Later, the most actively-traded contract touched an intra-day high of RMB 40,200/mt. Near session’s end, the red metal fell back due to position closures by longs and closed at RMB 40,020/mt, rising RMB 310/mt or 0.78%. Positions saw a growth of 3,424 to 234,164 and trading volumes totaled 455,000 lots.

On the last trading day for SHFE 1510 copper, the contract ended up RMB 320/mt or 0.81% at RMB 40,070/mt. Positions came at 10,020.

On Thursday, spot copper was offered at premiums of RMB 20-70/mt over SHFE 1510 copper in Shanghai market, versus RMB 40,080-40,220/mt for standard-quality copper and RMB 40,100-40,250/mt for high-quality copper.

Price offers were mixed along with changes in SHFE 1510 and 1511 copper contract spread. Most cargo holders started to price spot copper according to SHFE 1511 copper contract. Trading activities were active responding to a drop in SHFE copper. Traders rushed to sell before the delivery of SHFE 1510 copper with high-quality copper holding firm at premiums of RMB 70/mt. In the afternoon, transactions were contained by SHFE copper price rally. Standard-quality copper prices were the first to be lowered to push trading, leading to slight discounts against SHFE 1511 copper. Trading was still contributed mainly by traders whilst downstream producers watched from the sidelines.